O B L I G AT I O N is a juridical necessity to give, to do or not to do.

It comes from the Latin word obligare

which means to bind.
GENERAL PROVISIONS
Nature of obligations under Civil Code
Civil Obligations legally demandable and the courts of justice may compel their
performance.
Natural Obligations based on
legally demandable.

morality, natural law and conscience, they are not

Requisites of Obligations
Juridical or legal tie the vinculum or the link that binds the party
Prestation - consist in giving, doing or not doing something
Active subject person who can demand the performance of the obligation or known as
the creditor or oblige
Passive subject the person from whom prestation is demandable or known as the debtor
or obligor
Illustration:
A entered into a contract with B whereby A agreed to deliver to B a washing machine
on Monday. The juridical tie is the contract, the prestation is the delivery of the
washing machine, the active subject
is B, and the passive subject is A.
Sources of Obligations
Law imposed by the law itself
Illustration:
By provision of law, a husband and wife are obliged to live
mutual respect and fidelity, and render mutual help and support.

together,

observe

Contracts the meeting of minds between two persons whereby one binds himself with
respect to the other to give something or to render service.
Quasi-contracts the act of a person, permitted by law, by which he obligates himself
towards another, or by which another binds himself to him, without any agreement
between them.
Illustration:
Suppose A owes B the sum of P50.00, but by mistake A pays B the amount of
P100.00. In this case, B must return to A the P50.00 because as to the excess, that is
payment of something not owing (Solutio Indebiti).

Acts or omissions punished by law refers to a crime or a penal offense, like murder.
Illustration:
Supposing A kills B. If the court finds that A is guilty, A will be sentenced either to
imprisonment or death, depending on the gravity of the offense.

Quasi-delicts a legal wrong, committed through fault or negligence, on a person or

property, independent of contract.
Illustration:
Supposing Maria, while watering her flower pot in her house, negligently caused the
same to fall, hitting Jose who suffered injuries. Maria is then obliged to pay for the
damage sustained by Jose.
Requisites of Quasi-delicts

An act or omission;

Accompanied by fault or negligence;

Causing damage to another;

There must be no pre-existing contractual relation between the parties.

DIFFERENT KINDS OF OBLIGATIONS

Pure and Conditional Obligations
Pure Obligations one which is not subject to conditions nor does it mention a
specific date for its fulfillment
Illustration:
Juan obliged himself to deliver a refrigerator to Pedro.
Conditional Obligations is one which is subject to a condition
Two Kinds of Conditions

Suspensive Condition a condition which suspends the demandability of the obligation

until the fulfilment of the condition.
Illustration:
I
will
give

you

car

if

you

pass

the

ECE examinations.

Resolutory Condition produces the extinguishment of an obligation upon the

happening of the event.
Illustration:
I will let you use my car until you finish your course in business administration.

Obligations With a Period those whose consequences are subjected in one way or the
other to the expiration of said term.
Illustration:
A borrowed money from B in the amount of P50.00 promising to pay the amount
as soon as possible. If later on, they cannot agree on the specific date of payment,
the remedy of B is to go to court and ask the court to fix the date when the debt
is to be paid.
Kinds of Period

Ex die a period with suspensive effect

In diem a period with a resolutory effect and the validity of obligation is up

to a certain date
Other Kinds:
o
Legal period period established by law
o
Voluntary period period agreed to by the parties
o
Judicial period period authorized by the court
Alternative Obligations is one wherein various things are due, but the payment of
one of them is sufficient, determined by the choice which as a general rule belongs to
the obligor.

Illustration:
Marc obliged himself to deliver to Edwin either a piano or a refrigerator. The
delivery of the piano or the refrigerator is sufficient compliance with the obligation.
Marc could not compel Edwin to accept only a part of the piano or a part of the
refrigerator because in alternative obligations complete performance of one of the
prestations is necessary.

Joint and Solidary Obligations

Joint Obligations is one which each of the debtors is answerable only for a proportionate
part of the debt and each one of the creditors is entitled to a proportionate part of the
credit.
Illustration:
Juan and Pedro are jointly indebted to Jose the amount of P100.00. As such,
Juan is liable to Jose for the amount of P50.00 only, while Pedro is also liable to
Jose for the same amount of P50.00. Jose, the creditor, is entitled to demand from
Juan and Pedro P50.00 each.

Solidary Obligations is one which each of the debtors is liable for the whole
obligation and each of the creditors may demand compliance of the entire obligation.

Illustration:
Juan and Pedro are the solidary debtors of Jose for the amount
of P100.00. Hence either of them may be compelled by Jose to
pay the whole amount of P100.00. So Jose can demand from Juan
the amount of P100.00. Jose can also demand from Pedro the
amount of P100.00. However, if Juan pays P100.00, then the
obligation is extinguished and the paying debtor (Juan) is entitled
to be reimbursed by his co-debtor (Pedro) for his part of the debt,
which is P50.00.
Kinds
of
Solidarity
o
Active Solidarity when the solidarity exists among the
creditors only.
o
Passive Solidarity when the solidarity takes place
among the debtors only.
o
Mixed Solidarity when the solidarity exists both among the
creditors and the debtors at the same time.

Divisible
and
Indivisible
Obligations
Divisible Obligation is one which is capable of partial
performance.
Illustration:
Juan obliged himself to deliver to Pedro six sacks of rice as follows:
Three sacks of rice to be delivered by Juan on May 1st, and Pedro
to pay Juan the amount of P150.00. Another three sacks of rice to
be delivered by Juan on June 1st, and Pedro to pay Juan the same
amount of P150.00. The obligation of Juan to Pedro to deliver rice
is divisible because the parties intended partial performance.
Indivisible Obligation is one which is not capable of partial
performance.
Illustration:
In the preceding example, if Juan and Pedro agreed that all the
six sacks of rice should be deliver on May 1st, then
notwithstanding that the object of the obligation is physically
divisible. Nevertheless, it is indivisible because the parties
intended complete performance at one given time. Juan,
therefore, must deliver all the six sacks of rice on May 1st.
he cannot deliver two or three or even five, because that case
the delivery still constitutes partial performance.

Three Classes of Divisions

Qualitative depends on quality rather than
quantity
Quantitative depends on quantity rather
than quality
Ideal also known as moral, intellectual or
mental division

Obligations
Clause

With

penal

Definition of Penal Clause an accessory undertaking to assume

greater liability in case of a breach.
Illustration:
A stipulation in the contract for the sale of a residential lot,
that the vendee would complete within two years from the date of
the sale 50% of his residence on the lot, and, in the event of
failure to do so, the vendee would pay the vendor the sum of
P10,000.00.
Two Classifcations of Penal
Clause

Subsidiary when only the penalty can be

demanded
Illustration:
A binds himself to deliver to B a Honda Civic car at the end
of the current year. They agree in writing that should A fail
to deliver the car on a specified date, A shall pay B as
penalty P10,000.00. A fails to make the delivery. B could
demand the payment of P10,000.00 against A. B, however
could not compel A to deliver the car and pay the penalty at
the same time. The payment of the penalty takes the place of
the principal obligation.

Joint when both the principal contract and the penal clause
can be enforced

Illustration:
A borrowed from B the amount of P100.00 payable on October 10, 2007. They agreed
further that should A fail to pay the amount on the said date, A shall pay B the amount of
P10.00 as penalty. On October 10, 2007, A failed to pay B. In such case, B could go to the
court and demand payment of the principal amount of P100.00 and also the penalty of
P10.00. However, if the penalty is iniquitous, merciless and shocking to conscience, it shall
not be enforced. Instead it may be reduced by the court.

EXTINGUISHMENT OF OBLIGATIONS

By Payment or Performance payment means not only the

delivery of money but also the performance, in any other manner,
of an obligation.

By the loss of the thing due when it perishes or goes out of

commerce or disappears in such a way that its existence is
unknown or it cannot be recovered.

By the condition or remission of the debt it is an act of

liberality by which the oblige, who receives no price or
equivalent thereof, renounces the enforcement of the obligation,
which is extinguished in its entirely or in that part or aspect of
the same to which the remission refers.

Kinds
of
Condonation
or
Remission

Complete when the enforcement of the obligation is

waived or renounced totally

Partial when the waiver or renunciation refers only to a part

of the obligation.

Express when it is shown by words or declaration of the obligee.

Implied when it is inferred from the acts or conduct of the obligee.

By the confusion or merger of the rights of creditor and debtor

it is the meeting in one person of the qualities of obligee and

obligor with respect to the same obligation.
By compensation takes place when two persons, in their own
right, are creditors and debtors of each other.
Kinds of Compensation
Legal compensation takes place when compensation
extinguishes the two debts in their concurrent amounts
even without the express agreement of the parties.
Voluntary compensation takes place when there is
compensation by agreement of the parties as in the
case of mutual set off of accounts.
Judicial compensation takes place when the court
permits the counterclaim of the defendant as against the
claim of the plaintiff.

Partial compensation takes place when the two

obligations are of different amounts and a balance
remains unextinguished after the compensation.
Total compensation takes place when the obligations
are
of
the same amount and compensation
extinguishes the obligations entirely.

Illustration:
A is indebted to
hand, B is also
Both debts are
both are, in their
other.

B in the amount of P100.00. On the other

indebted to A in the amount of P100.00.
due. Compensation will take place because
own right, creditors and debtors of each

By novation it is the change, substitution, or renewal of an

obligation or obligatory relation, with the intention of

extinguishing or modifying essentially the former, debitum pro

debito (new debt for old debt).
Kinds
of
Novation

Real novation the change in the object or principal conditions

of the obligation.
Illustration:
A obliged himself to deliver to B a car. Subsequently, they
entered into another contract whereby instead of A
delivering a car, A would deliver a truck. The object of the
obligation was changed, so the novation was a real novation.

Personal novation another person is sustained in place of the

debtor or he is subrogated to the rights of the creditor.
Illustration:
A is indebted to B in the amount of P100.00. A now requests B
to accept C as debtor in his (As) place. If B accepts C as
his new debtor, who assumes the obligation of A, then
there is a novation by the substitution of the person of the
debtor. If it is B who requests that he be changed by C and A
agrees, then there is also novation this time by the
subrogation of a third person in the place of the creditor.

Mixed novation the change in the person of the parties

and the objects or modification of principal condition.

Illustration:
A
obliged
himself
to
deliver
to
B
a
carabao.
Subsequently A proposed that C would take his place but
instead of delivering a carabao he would deliver a horse. If B
and C agreed, then there was a mixed novation because the
object of the obligation and the person of the obligor
were changed.
------------------------------------------------------------------------------------------------------------------------------------------------------------------CONTRACTS is the meeting of the minds between two persons
whereby one binds himself with respect to the other to give
something or to render
service. It comes from the Latin word
contractus which signifies an agreement.
GENERAL
PROVISIONS
Elements
of
Contracts
Essential Elements

consent of the parties

object or subject matter

cause or consideration

Natural elements are those the existence of which is

presumed by law unless there is an agreement to the contrary

Accidental elements consist of the unusual stipulation of the

parties such as conditions, terms, etc.

Stages of a Contract:
Preparation or Conception includes all the initial stages up to
the time the parties agree upon the terms of the contract.
Illustration:
Juan offers to sell his horse to Pedro for P2,000.00. Pedro asks
Juan to bring his horse to his place to enable him to see whether
the horse is fit for carretela purposes. Juan brings the horse to
Pedros place and the latter is allowed by Juan to use his horse
in pulling Pedros carretela to enable the latter to see whether
the horse has sufficient speed, is physically fit, etc. After trying the
horse, Pedro bargains with Juan as to the price. Up to this stage,
the parties are doing things leading to the meeting of the minds.
Perfection or Birth the time when the minds of the parties meet
in agreement upon the object or subject matter as well as to the
price or consideration.
Illustration:
Juan agrees to receive P2,000.00 for his horse and Pedro
agrees to take the horse for that amount. The contract here is
perfected because there is already a meeting of the minds.
Consummation
Termination

or

Illustration:
Juan delivers the horse to Pedro and the same is accepted.
Pedro gives the amount P2,000.00 as purchase price and the
latter receives it. In here, the contract is consummated and
terminated.
Classification of Contracts
Express and Implied Contracts is one written in the intent of the
parties is shown by words, oral or written.

Executed and Executory Contracts

Executed contract is one that has already been performed
Executory contract is one that is not yet performed

Consensual and Real Contracts

Consensual contract is one perfected by mere consent
Real contract is one perfected by the delivery of the thing which
is the object of the contract

Unilateral
Contracts

and

Bilateral

Unilateral contract only one of the parties has an

obligation
Bilateral contract both parties has an
obligation
Limitations upon the right to contract
Contrary to law The parties to a contract cannot agree to an
object or purpose which is against the law.
Illustration:
A, for and in consideration of P1,000.00, entered into a
contract with B whereby the latter agreed to murder C.
Against morals No contact may be entered into which is against
virtuous conduct and ethical precept.
Illustration:
A entered into a contract with B whereby for and in
consideration of P1,000.00 the latter agrees to live with A without
the benefit of marriage.

Contrary to good customs The contracting parties are prohibited

from entering into contracts which conflict with good and
established practice or customs.
Illustration:
Pedro and Maria decided to get married on October 10, 2007.
Invitations were printed and distributed to relatives and friends
and apparel were purchased including matrimonial bed. Pedro,
however walked out of it and was never heard of again.

Contrary to public order Signifies the public weal which are

permanent and essential in institutions.
Illustration:
An agreement that the creditor can use force or violence to
compel the debtor to pay is contrary to public order.

Contrary to public policy Refers not only to public safety but

also to considerations which are moved by the common good.
Illustration:

A entered into a contract with B wherby A will not enter into

any enterprise whatever in the Philippines. This is against public
policy as it is a contract in restraint of trade.
ESSENTIAL REQUISITES OF CONTRACTS
Consent manifested by the meeting of the offer and the
acceptance upon the thing and the cause which are to constitute the
contract
Object of Contracts it may be things, rights and services

Things must be within the commerce of men, must

not be impossible, either physical or legally and must
be determinate as to their kind.

Rights may be transmissible or not transmissible. Examples of these rights

are the right to vote, rights flowing from a contract of marriage, parental
authority, etc.

Cause of Contracts the immediate, direct and proximate reason which justifies the
creation of an obligation thru the will of the contracting parties.
Illustration:
Juan offers to sell to Jose his only white horse for P500.00. Jose accepts the offer. Here,
the consent of the parties is manifested by the concurrence of their wills as to the white
horse and as to the price. The object is the white horse and the cause is P500.00.

Classification of Contracts as to its Cause

Onerous Contract the cause is the mutual undertaking or promise of either of the
contracting parties.
Illustration:
Juan sells his car to Pedro for P10,000.00.This contract of sale creates a reciprocal
obligation in both parties. Juan is obliged to deliver the car to Pedro and the latter
is obliged to pay Juan the purchase price of P10,000.00.

Remunetory Contract
remuneration is given.

the

cause

is

the

service

or

benefit

for

which

the

Illustration:
Juan is accused for a crime in court. He retains the services of Atty. Dela Cruz as his
defense counsel for P5,000.00. The P5,000.00 to be given by Juan to Atty. Dela Cruz
is for the professional services of Atty. Dela Cruz.
Gratuitous Contract the cause is the pure liberality of the giver.
Illustration:
Pedro donated a parcel of land to the municipality of Naic, Cavite, to be used as the
municipal cemetery without receiving any valuable consideration for the same. Here,
the cause of the contract of donation is the mere liberality of Pedro, the benefactor.
Requisites of a valid cause or consideration
The cause must be in existence.
That the cause must be lawful and not contrary to law, morals, good customs,
public policy, and
The cause must be true because the statement of a false cause renders the
contract void.
REFORMATION OF INSTRUMENTS
Reformation is a remedy in equity by means of which a written instrument is made or
construed so as to express or conform to the real intention of the parties when some error
or mistake has been committed.
Requisites

of Reformation
There is a valid contract;
The contract is in writing;
The written contract fails to express the true intention of the parties
The failure of the written contract to express the true intention is due to mutual
mistake, fraud, inequitable conduct, or accident.

DEFECTIVE CONTRACTS
Types of Defective Contracts
Rescissible Contract it has all the essential requisites of a contract and the contract
itself is valid, but by reason of injury or damage to third persons, such as creditors,
the contract may be rescinded.
Example of rescissible contracts

Those which are entered into by guardians whenever the wards whom they
represent suffer lesion by more than one-fourth of the value of the things
which are the object thereof;
Those agreed upon in representation of absentees if the latter suffer the
lesion stated in the preceding number;
Those undertaken in fraud of creditors when the latter cannot in any other
manner collect the claims due them;
Those which refer to things under litigation if they have been entered into by
the defendant without the knowledge and approval of the litigants or of
competent judicial authority;
All other contracts specially declared by law to be subject to rescission.
Lesion damage or injury suffered by the party seeking rescission by reason of the
fact that the price is unjust or inadequate
Voidable Contracts is one that possesses all the essential requisites of a valid contract,
namely, consent, object and cause or consideration. It is a valid contract until it is
annulled.
Contracts that is voidable even though there may have been no damage to the
contracting parties

Those where one of the parties is incapable of giving consent to a contract;

Those where the consent is vitiated by mistake, violence, intimidation,

undue influence or fraud.

Unenforceable Contracts a contract is said to be unenforceable when it cannot be sued

upon or enforced in court unless it is ratified.
The following contracts are unenforceable unless they are ratified

Those entered into the name of another person by one who has been given
no authority or legal representation, or who has acted beyond his powers;

Those that do not comply with the statute of frauds as set forth in this number.
In the following cases an agreement hereafter made shall be unenforceable by
action, unless the same, or some note or memorandum thereof, be in writing,
and subscribed by the party charged, or by his agent; evidence, thereof, of the
agreement cannot be received without the writing, or a secondary evidence of its
contents.

Those were both parties are incapable of giving consent to a contract.

Void or Inexistent Contracts one which is absolutely without legal force or effect. It is
not susceptible of ratification.
Contracts that are inexistent and void from the beginning
Those whose cause, object or purpose is contrary to law, morals, good
customs, public order or public policy;
Those which are absolutely simulated or fictitious;
Those whose cause or object did not exist at the time of the transaction;
Those whose object is outside the commerce of men;
Those which contemplate an impossible service;
Those where the intention of the parties relative to the principal object of the
contract cannot be ascertained;
Those expressly prohibited or declared void by law.
Characteristics of void contracts

Void or inexistent contracts produce no legal effects whatsoever.

Void or inexistent contracts cannot be ratified.

The right to set up the defense of inexistence or absolute nullity

cannot be waived or renounced.

The action or defense for the declaration of their inexistence or absolute nullity
is imprescriptible.
The inexistence or absolute nullity of a contract cannot be invoked by a
person whose interests are not directly affected.

---------------------------------------------------------------------------------------------------------------------------------------------------

DAMAGES is the sum of money which the law awards or imposes as percuniary compensation,
recompense, or satisfaction for an injury done or a wrong sustained as a consequence either of a breach
of a contractual obligation or a tortious act.

Injury denotes the illegal act

Types of Damages
Actual or Compensatory Damages damages that cover actual injury or economic
loss. It is intended to put the injured party in the position he was in prior to the injury.
It typically includes medical expenses, lost wages and the repair or replacement of
property.

Moral Damages includes physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation, and similar
injury.

Nominal Damages these are small and trivial sums awarded for a technical injury due
to a violation of some legal right, and as a consequence of which some damages
must be awarded to determine the right.

Temperate or Moderate Damages Temperate damages are such damages as are

reasonable compensation for the injury. They are more than nominal damages but less
than compensatory damages and may be recovered when the court finds that some
pecuniary loss has been suffered but its amount cannot, from the nature of the case,
be proved with certainty.
Liquidated Damages the amount of which has been agreed upon by the parties or
fixed by the judgement of a competent court.

Exemplary or Corrective Damages damages which are given in enhancement merely of

the ordinary damages on account of wanton, reckless, malicious, or oppressive character
of the acts complained of.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------LAW MERCHANT is a branch of the unwritten law which was originally founded on the customs of
merchants, mariners and business men generally in their dealings with one another throughout the
civilized countries of the world.
The following are considered to be merchants

Those who, having legal capacity to engage in commerce, habitually devote

themselves to it.

Commercial or industrial companies which may be created in

accordance with law.
Legal qualifcations of merchants

Those who have completed the age of 21;

Not being subject to the authority of the father or the mother, nor to marital authority and;
Have the free disposition of their property.

Persons not qualifed to engage in commerce

Persons sentenced to civil interdiction;

Persons who have been declared bankrupts and;

Persons who are prohibited from trading under special laws.

Persons not qualifed to engage in business:

Officers and employees in the civil service, whether classified or unclassified,

shall not engage in any private business, vocation, or profession, or be
connected with any commercial undertaking, without written permission from
the chief of the bureau or office in which they are serving, and of the President of
the Republic or proper department head.

The heads of departments and chiefs of bureaus or offices and their assistants
shall not, during their continuance in office, engage in the practice of any
profession or intervene, directly or indirectly, in the management or control of

any private enterprise which in any way may be affected by the functions of
their office; nor shall they, directly or indirectly, be financially interested in any
contract with the Government, or any subdivision or instrumentality thereof.
Registration of Merchants

Bureau of Commerce for those merchants having their place of business in Manila

Register of Deeds for those in the provinces

Securities and Exchange Commission for corporations and all partnerships

with a capital of three thousand pesos (P3,000.00) or more

Bureau of Customs in the case of vessels, those more than 3 tons gross
1.
A.
B.
C.
D.
2.
A.
B.
C.
D.
3.
A.
B.
C.
D.
4.
A.
B.
C.
D.
5.
A.
B.
C.
D.

A juridical necessity to give, to do, or not to do.

Contracts
Obligation
Quasi-delicts
Condition
Obligation comes from the latin word

_ which means to bind.

Obligum
Obligate
Obligare
Obligus
A legal wrong, committed through fault or negligence, on a person or property, independent of contract.
Contracts
Obligation
Quasi-delicts
Condition
A nature of obligation under civil code which is legally demandable and the courts of justice may compel their
performance.
Civil Obligations
Natural Obligation
Pure Obligation
Condition
A nature of obligation under civil code based on

morality, natural law and conscience, they are not legally demandable.

Civil Obligations
Natural Obligation
Pure Obligation
Condition

6.
A.
B.
C.
D.

Requisites of obligations which is the vinculum or the link that binds the party
Juridical or legal tie
Prestation
Active subject
Passive subject

7.

Requisites of obligation consist in giving, doing or not doing something

A.
B.
C.
D.
8.

Juridical or legal tie

Prestation
Active subject
Passive subject
Requisites of obligation that refers to a person who can demand the performance of the obligation or known as the
creditor or oblige

A. Juridical or legal tie

B. Prestation
C. Active subject
D. Passive subject
9.
A.
B.
C.
D.

Requisites of obligation that refers to a person from whom prestation is demandable or known as the debtor or obligor
Juridical or legal tie
Prestation
Active subject
Passive subject

10. One of the following is not considered as a source of obligation.

A.
B.
C.
D.

Law
Contracts
Quasi-delicts
Work

11. The following are requisites of Quasi-delicts except

A.
B.
C.
D.

An act or omission
Accompanied by fault or negligence
There must be no pre-existing contractual relation between the parties.
Acts or omissions punished by law

12. An obligation which is not subject to conditions or burdens nor does it mention a specific date for its fulfilment and as
such it is immediately demandable.
A.
B.
C.
D.

Pure obligation
Conditional obligation
Reciprocal obligation
Alternative obligation

13. An uncertain event which wields an influence on a legal relation.

A.
B.
C.
D.

Pure obligation
Condition
Reciprocal obligation
Alternative obligation

14. An obligation which is a subject to a condition.

A.
B.
C.
D.

Pure obligation
Conditional obligation
Reciprocal obligation
Alternative obligation

15. A kind of condition which suspends the demandability of the obligation until the fulfilment of the condition.
A.
B.
C.
D.
16.
A.
B.
C.
D.

Suspensive Condition
Alternative obligation
Reciprocal obligation
Resolutory Condition
A kind of condition that produces the extinguishment of an obligation upon the happening of the event.
Suspensive Condition
Alternative obligation
Reciprocal obligation
Resolutory Condition

17. An obligation whose consequences are subjected in one way or the other to the expiration of said term.
A. Pure obligation

B. Obligations with a period

C. Reciprocal obligation
D. Alternative obligation
18. A borrowed money from B in the amount of P50.00 promising to pay the amount as soon as possible. If later on,
they cannot agree on the specific date of payment, the remedy of B is to go to court and ask the court to fix the date
when the debt is to be paid. This illustrates:
A.
B.
C.
D.

Pure obligation
Obligations with a period
Reciprocal obligation
Alternative obligation

19. A kind of period with suspensive effect.

A.
B.
C.
D.

Ex die
In diem
Legal period
Voluntary period

20. A kind of period with a resolutory effect and the validity of obligation is up to a certain date
A.
B.
C.
D.

21.
A.
B.
C.
D.

Ex die
In diem
Legal period
Voluntary perio

A period established by law.

Ex die
In diem
Legal period
Voluntary period

22. A period agreed to by the parties.

A.
B.
C.
D.

Judicial period
In diem
Legal period
Voluntary period

23. A period authorized by the court.

A.
B.
C.
D.

Judicial period
In diem
Legal period
Voluntary period

24. An obligation where two parties are mutually obliged to do or to give something.
A.
B.
C.
D.

Pure obligation
Condition
Reciprocal obligation
Alternative obligation

25. Marc obliged himself to deliver to Edwin either a piano or a refrigerator.

The delivery of the piano or the refrigerator is sufficient compliance with the obligation. Marc could not compel Edwin to
accept only a part of the piano or a part of the refrigerator because this illustrates:
A.
B.
C.
D.

Pure obligation
Condition
Reciprocal obligation
Alternative obligation

26. An obligation wherein various things are due, but the payment of one of them is sufficient, determined by the choice
which as a general rule belongs to the obligor.
A. Pure obligation
B. Condition
C. Reciprocal obligation
D. Alternative obligation
27. One in which each of the debtors is answerable only for a proportionate part
creditors is entitled to a proportionate part of the credit
A. Joint obligation
B. Solidary obligation
C. Divisible obligation
D. Indivisible obligation

of the debt, and each

one

of

the

28. One in which each of the debtors is liable for the whole obligation and each of the creditors may demand compliance of
the entire obligation.
A.
B.
C.
D.

Joint obligation
Solidary obligation
Divisible obligation
Indivisible obligation

29. A kind of solidarity when it exists among the creditors only.

A.
B.
C.
D.

Active Solidarity
Passive Solidarity
Mixed Solidarity
Solo Solidarity

30. When the solidarity takes place among the debtors only, it is called
A.
B.
C.
D.

Active Solidarity
Passive Solidarity
Mixed Solidarity
Solo Solidarit

31. When the solidarity exists both among the creditors and the debtors at the same time, this is called
A.
B.
C.
D.

Active Solidarity
Passive Solidarity
Mixed Solidarity
Solo Solidarity

32. An obligation which is capable of partial performance.

A.
B.
C.
D.

Joint obligation
Solidary obligation
Divisible obligation
Indivisible obligation

33. Juan obliged himself to deliver to Pedro six sacks of rice as follows: Three sacks of rice to be delivered by Juan on
May 1st, and Pedro to pay Juan the amount of P150.00. Another three sacks of rice to be delivered by Juan on June
1st, and Pedro to pay Juan the same amount of P150.00. This illustrates:
A.
B.
C.
D.

Joint obligation
Solidary obligation
Divisible obligation
Indivisible obligation

34. A type division that depends on quality rather than quantity

A. Qualitative

B. Quantitative
C. Ideal
D. Moral
35. A type of division that depends on quantity rather than quality
A.
B.
C.
D.
36.
A.
B.
C.
D.

Qualitative
Quantitative
Ideal
Mental
A type of division also known as moral, intellectual or mental division
Qualitative
Quantitative
Ideal
All of the above

37. It is an accessory undertaking to assume greater liability in case of breach.

A.
B.
C.
D.

Law
Penal clause
Stipulation
Preceding

38. A binds himself to deliver to B a Honda Civic car at the end of the current year. They agree in writing that should
A fail to deliver the car on a specified date, A shall pay B as penalty P10,000.00. A fails to make the delivery. B
could demand the payment of P10,000.00 against A. B, however could not compel A to deliver the car and pay
the penalty at the same time. This is
_ type of penal clause:
A.
B.
C.
D.

Joint
Subsidiary
Solo
Partial

39. A classification of penal clause when both the principal contract and the penal clause can be enforced.
A.
B.
C.
D.

Joint
Subsidiary
Solo
Partial

40. An obligation can be extinguished by the following except

A.
B.
C.
D.
41.
A.
B.
C.
D.

By Payment or Performance
By the condition or remission of the debt
By altering the signature
By the loss of the thing due
An obligation which is not capable of partial performance.
Joint obligation
Solidary obligation
Divisible obligation
Indivisible obligation

42. A kind of remission when the enforcement of the obligation is waived or renounced totally.
A.
B.
C.
D.
43.
A.
B.
C.

Partial
Complete
Express
Implied
A remission when the waiver or renunciation refers only to a part of the obligation.
Partial
Complete
Express

D. Implied
44. A remission when it is shown by words or declaration of the obligee.
A.
B.
C.
D.

Partial
Complete
Express
Implied

45. A remission when it is inferred from the acts or conduct of the obligee.
A.
B.
C.
D.
46.
A.
B.
C.
D.

Partial
Complete
Express
Implied
A type of compensation that takes place when compensation extinguishes the two debts in their concurrent amounts
even without the express agreement of the parties. Judicial compensation
Legal compensation
Voluntary compensation
Judicial compensation
Partial compensation

47. A type of compensation that takes place when there is compensation by agreement of the parties as in the case of mutual
set off of accounts.
A.
B.
C.
D.

Legal compensation
Voluntary compensation
Judicial compensation
Partial compensation

48. A type of compensation that takes place when the court permits the counterclaim of the defendant as against the
claim of the plaintiff.
A.
B.
C.
D.

Legal compensation
Total compensation
Judicial compensation
Partial compensation

49. A type of compensation that takes place when the two obligations are of different amounts and a balance remains
unextinguished after the compensation.
A.
B.
C.
D.

Legal compensation
Total compensation
Judicial compensation
Partial compensation

50. A type of compensation that takes place when the obligations are of the same amount and compensation extinguishes the
obligations entirely.
A.
B.
C.
D.

Legal compensation
Total compensation
Judicial compensation
Partial compensatio
51. A. novation where the principal conditions of the obligation is change.
A.
B.
C.
D.

True novation
Real novation
Personal novation
Substitute novation

52. A obliged himself to deliver to B a car. Subsequently, they entered into another contract whereby instead of A
delivering a car, A would deliver a truck. This illustrates:

A.
B.
C.
D.

True novation
Real novation
Personal novation
Substitute novation

53. A novation where another person is sustained in place of the debtor or he is subrogated to the rights of the creditor.
A.
B.
C.
D.

True novation
Real novation
Personal novation
Substitute novation

54. A novation where there is a change in the person of the parties and the objects or modification of principal condition.
A.
B.
C.
D.

Mixed novation
Real novation
Personal novation
Substitute novation

55. It is the meeting of minds between two persons whereby one binds himself with respect to the other to give
something or to render some service.
A.
B.
C.
D.
56.
A.
B.
C.
D.

Contracts
Obligation
Quasi-delicts
Condition
A contract comes from the Latin word _
Kontrus
contractus
Tractum
Contractumus

which signifies an agreement.

57. The following are considered to be the essential elements of contracts except
A.
B.
C.
D.

consent of the parties

object or subject matter
cause or consideration
effects to the subject

58. An element of contracts which refers to those the existence of which is presumed by law unless there is an
agreement to the contrary
A. Essential element
B. Natural elements
C. Accidental elements
D. Unnatural elements
59. Refers to an element of contracts that consist of the unusual stipulation of the parties such as conditions, terms, etc.
A.
B.
C.
D.

Essential element
Natural elements
Accidental elements
Unnatural elements

60. A stage of a contract that includes all the initial stages up to the time the parties agree upon the terms of the
contract.
A. Preparation or Conception
B. Perfection or Birth
C. Consummation or Termination
D. Deliberation

61. A stage of a contract that refers to the time when the minds of the parties meet in agreement upon the object or
subject matter as well as to the price or consideration.
A. Preparation or Conception

B. Perfection or Birth
C. Consummation or Termination
D. Deliberation
62. Juan agrees to receive P2,000.00 for his horse and Pedro agrees to take the horse for that amount. This refers to
what stage of the contract
A. Preparation or Conception
B. Perfection or Birth
C. Consummation or Termination
D. Deliberation
63. Juan delivers the horse to Pedro and the same is accepted. Pedro gives the amount P2,000.00 as purchase price and
the latter receives it.This is an example of what stage of the contract
A. Preparation or Conception
B. Perfection or Birth
C. Consummation or Termination
D. Deliberation
64.
A.
B.
C.
D.

A contract wherein the intent of the parties is shown by words, oral or written.
Express contract
Implied contracts
Executed contracts
Executory contracts

65.
A.
B.
C.
D.

A contract wherein the intent of the parties is shown by conduct.

Express contract
Implied contracts
Executed contracts
Executory contracts

66.
A.
B.
C.
D.

A contract that has already been performed.

Express contract
Implied contracts
Executed contracts
Executory contracts

67.
A.
B.
C.
D.

A contract that has not yet performed.

Express contract
Implied contracts
Executed contracts
Executory contracts

68.
A.
B.
C.
D.

A contract that is perfected by mere consent, such as a contract of sale.

Consensual contract
Bilateral contract
Real contract
Unilateral contract

69.
A.
B.
C.
D.

A contract that is perfected by delivery of the thing which is the object of the contract.
Consensual contract
Bilateral contract
Real contract
Unilateral contract

70.
A.
B.
C.
D.

A contract where only one of the parties has an obligation such as in commodatum or gratuitous deposit.
Consensual contract
Bilateral contract
Real contract
Unilateral contract

71.
A.
B.
C.
D.

A contract that creates reciprocal obligations.

Consensual contract
Bilateral contract
Real contract
Unilateral contract

72. A, for and in consideration of P1,000.00, entered into a contract with B whereby the latter agreed
to murder C. This limitation upon the right to contract that refers to
A.
B.
C.
D.

Contrary to law
Against moral
Contrary to good customs
Contrary to public order

73. A entered into a contract with B whereby for and in consideration of P100,000.00 the latter agrees
to live with A without the benefit of marriage. This limitation upon the right to contract that refers to
A.
B.
C.
D.

Contrary to law
Against moral
Contrary to good customs
Contrary to public order

74. Pedro and Maria decided to get married on October 10, 2007. Invitations were printed and distributed
to relatives and friends and apparel were purchased including matrimonial bed. Pedro, however
walked out of it and was never heard of again. This limitation upon the right to contract that refers to
A.
B.
C.
D.

Contrary to law
Against moral
Contrary to good customs
Contrary to public order

75. A entered into a contract with B wherby A will not enter into any enterprise whatever in the
Philippines. This limitation upon the right to contract that refers to
A.
B.
C.
D.

Contrary to law
Against moral
Contrary to good customs
Contrary to public order

76. The following are requisites of contracts except

A. Consent
B. Object of contract
C. Cause of contract
D. Effect of contract
77. A classification of contracts as to its cause where the cause is the pure liberality of the giver.
A.
B.
C.
D.

Gratuitous Contract
Remunetory Contract
Onerous Contract
Liberation Contract

78. A classification of contracts as to its cause where the cause is the service or benefit for which the
remuneration is given.
A.
B.
C.
D.

Gratuitous Contract
Remunetory Contract
Onerous Contract
Liberation Contract

79. A classification of contracts as to its cause where the cause is the mutual undertaking or promise
of either of the contracting parties.

A.
B.
C.
D.

Gratuitous Contract
Remunetory Contract
Onerous Contract
Liberation Contract

80. Remedy in equity by means of which a written instrument is made or construed so as to express or
conform to the real intention of the parties when some error or mistake has been committed.
A. Reformation
B. Novation
C. Defect
D. Erroneous
81. Which of the following cannot be considered as a requisite of reformation
a. There is a valid contract;
b. The contract is in writing;
c. The oral contract expresses the true intention of the parties
d. The failure of the written contract to express the true intention is due to mutual mistake, fraud, inequitable conduct, or
accident.
82. A defective contract where it has all the essential requisites of a contract and the contract itself is valid, but by
reason of injury or damage to third persons, such as creditors, the contract may be rescinded.
A.
B.
C.
D.

Rescissible Contract
Voidable Contracts
Unenforceable Contracts
Void or Inexistent Contracts

83. A damage or injury suffered by the party seeking rescission by reason of the fact that the price is unjust or inadequate.
A.
B.
C.
D.

damage
effect
lesion
payment

84. A contract which possesses all the essential requisites of a valid contract, namely, consent, object and cause or
consideration. It is a valid contract until it is annulled.
A.
B.
C.
D.

Void or Inexistent contract

Unenforceable contracts
Voidable contracts
Negotiorum Gestio

85.
A.
B.
C.
D.

A contract which is absolutely without legal force or effect.

Void or Inexistent contract
Unenforceable contracts
Voidable contracts
Negotiorum Gestio

86.
A.
B.
C.
D.

When a contract cannot be sued upon or enforced in court unless it is ratified is said to be
Void or Inexistent contract
Unenforceable contracts
Voidable contracts
Negotiorum Gestio

87. It is the voluntary administration of the abandoned business or property belonging to another without the consent of
the latter.
A. Void or Inexistent contract
B. Unenforceable contracts
C. Voidable contracts
D. Negotiorum Gestio
88. It is the sum of money which the law awards or imposes as percuniary compensation, recompense, or satisfaction for
an injury done or a wrong sustained as a consequence either of a breach of a contractual obligation or a tortious
act.

A.
B.
C.
D.

Payment
Injury
Damages
Compensation

89. Damages that cover actual injury or economic loss. It typically includes medical expenses, lost wages and the repair
or replacement of property.
A. Actual or Compensatory Damages
B. Nominal Damages
C. Moral Damages
D. Temperate or Moderate Damages
90. Damages that includes physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury.
A. Actual or Compensatory Damages
B. Nominal Damages
C. Moral Damages
D. Temperate or Moderate Damages

91. Damages which are small and trivial sums awarded for a technical injury due to a violation of
some legal right, and as a consequence of which some damages must be awarded to determine
the right.
A.
B.
C.
D.

Actual or Compensatory Damages

Nominal Damages
Moral Damages
Temperate or Moderate Damages

92. Damages that are reasonable compensation for the injury.

A.
B.
C.
D.

Actual or Compensatory Damages

Nominal Damages
Moral Damages
Temperate or Moderate Damages

93. Damages where the amount of which has been agreed upon by the parties or fixed by the
judgement of a competent court.
A.
B.
C.
D.

Liquidated Damages
Exemplary Damages
Corrective Damages
Compensatory Damages

94. Damages which are given in enhancement merely of the ordinary damages on account of
wanton, reckless, malicious, or oppressive character of the acts complained of.
A. Actual or Compensatory Damages
B. Nominal Damages
C. Moral Damages
D. Exemplary or Corrective Damages
95. Branch of the unwritten law which was originally founded on the customs of merchants, mariners
and business men generally in their dealings with one another throughout the civilized countries of
the world.
A. Law Merchant
B. Law of businessmen
C. Law of mariners
D. Law of people
316